Tax Relief Available For All Colorado
Disaster Victims Including Ranchers And Farmers

Colorado residents in the declared
counties affected by the severe winter storms of Dec. 18-22 and 28-31,
2006 may be eligible for various forms of tax relief that could lessen
some losses, according to federal and state recovery
officials.

Special rules apply to Presidentially declared disaster
or emergency areas and may be available to taxpayers living in one of the
declared counties who have sustained losses as a direct result of the
December 2006 storms. If you have a loss attributable to the 2006 storms
that occurred in an area designated by FEMA for emergency assistance, you
may elect to deduct that loss on your tax return for the immediately
preceding taxable year, 2005. For purposes of the election, a disaster
includes an event declared a major disaster or an emergency. You normally
have until April 17, 2007, the due date of your tax return for the tax
year of the disaster without extensions, to make this election. If you
have already filed your 2005 return, you may claim the loss by filing an
amended return, Form 1040X, for 2005.

Casualty losses for tax purposes generally are computed by
taking the lesser of the decrease in fair market value (FMV) of the
property as a result of the disaster or the adjusted basis of the
property. From the smaller of these two amounts you subtract any insurance
payments or other reimbursements you received or expect to receive. You
should keep the records that support your loss deductions. Photographs
taken after a casualty will be helpful in establishing the condition and
value of the property after it was damaged. Appraisals or estimates of
repairs may be useful in figuring the decrease in the FMV. You do not have
to attach the proof of loss to the tax return.

Casualty losses can
be claimed on IRS Form 4684.

IRS Publication 547, Casualties,
Disasters, and Thefts, and Publication 2194, Disaster Losses Kit for
Individuals, will help guide you through the process. These publications
and the Form 4684 are available for download from the IRS website at www.irs.gov/formspubs/index.html
, or by calling toll-free 1-800-829-1040. For casualty losses related to a
business, call 1-800-829-4933

We are a tax and accounting firm in Huntsville Alabama with a strong focus on helping small businesses reduce cost associated with taxes and to assist individual maximize their tax return. Some of the accounting and tax areas in which we are profficient includes, payroll taxes, quaterly and yearly reports, estimated tax, Late Filers, financial statements, income tax return and payroll processing and general bookkeeping. We are familiar with Peachtree, Quicken, CMS and Quickbook.